WASHINGTON DC (LOOTPRESS) – President Donald Trump on Friday called for a one-year cap on credit card interest rates at 10%, reigniting a long-running debate over consumer debt and drawing praise from lawmakers across the political spectrum while prompting sharp warnings from banks and card issuers.
In a post on Truth Social late Friday, Trump accused credit card companies of exploiting consumers with interest rates that often exceed 20%. “We will no longer let the American Public be ‘ripped off’ by Credit Card Companies that are charging Interest Rates of 20 to 30%, and even more,” he wrote, placing the blame on policies during the Biden administration.
Trump said the proposed cap would take effect on Jan. 20, 2026, marking one year since his second inauguration, and would remain in place for 12 months. Average credit card interest rates currently exceed 20%, according to Federal Reserve data, meaning a 10% cap would sharply reduce borrowing costs for millions of consumers.
It remains unclear how the president would seek to implement the proposal. The White House has not said whether Trump would pursue executive action or attempt to pressure credit card companies to lower rates voluntarily. Major card issuers have not yet publicly responded.
The proposal has found rare bipartisan backing on Capitol Hill. Last year, Republican Sen. Josh Hawley of Missouri and Sen. Bernie Sanders of Vermont, an independent who caucuses with Democrats, introduced legislation to impose a 10% cap on credit card interest rates. A similar bill was introduced in the House by Democratic Rep. Alexandria Ocasio-Cortez of New York and Republican Rep. Anna Paulina Luna of Florida. Other measures introduced in Congress would place more modest limits on interest rates and fees.
Trump also floated the idea of a temporary cap during his campaign. Hours before his Truth Social post, Sanders criticized the president on social media for not yet following through on the pledge.
Supporters argue that a cap would provide relief to Americans struggling with record levels of credit card debt. U.S. consumers owed $1.23 trillion in credit card balances in the third quarter of last year, the highest level on record, according to the Federal Reserve Bank of New York. A 2024 NerdWallet study found the average household with credit card debt owed $10,563. The Consumer Financial Protection Bureau has said credit card interest rates have risen “far above the cost of offering credit.”
“We cannot continue to allow big banks to make huge profits ripping off the American people,” Sanders said last year in a joint statement with Hawley. Luna has similarly argued that high interest rates trap working-class Americans in long-term debt.
Banks and financial industry groups, however, warn that a strict interest rate cap could restrict access to credit, particularly for higher-risk borrowers. The American Bankers Association and the Bank Policy Institute said in a joint statement that a 10% cap “would reduce credit availability and be devastating for millions of American families and small business owners who rely on and value their credit cards.”
The Bank Policy Institute estimates that more than 14 million households that typically carry balances could lose access to credit under such a cap. Industry groups also warn that consumers shut out of traditional credit cards could turn to less regulated, higher-cost options such as payday lenders and pawn shops.
Scott Simpson, CEO of America’s Credit Unions, said that while the goal of affordability is laudable, “capping rates at 10% does not make credit more affordable — it makes it unattainable for millions of working Americans.” Billionaire investor Bill Ackman, a Trump supporter during the 2024 campaign, also criticized the proposal, warning it could push consumers toward predatory lending.
The credit card proposal is part of a broader effort by Trump to address affordability and borrowing costs. Earlier this week, he directed the federal government to purchase $200 million in mortgage bonds using funds from Fannie Mae and Freddie Mac to help lower mortgage rates. He has also repeatedly urged the Federal Reserve to cut interest rates more aggressively and is expected to nominate a new Fed chair in the coming weeks.
“I’m looking for somebody that will be honest with interest rates,” Trump said last month, signaling that reducing borrowing costs will remain a central focus of his economic agenda.
